My New Outside Blog

Learn the Important 5 Step buying process

It is important to understand what buyers are buying when they decide to buy a home.  The majority of buyers first buy the community.  The second is the neighborhood and the third is the street.  When a buyer goes to the house the fourth thing they buy is the exterior of the home and then buy the inside of the house.  In other words, this is the house that makes them feel at home.  These buyers can imagine themselves living in this home.

As they go from number one to number five, their emotions kick into overdrive.

At first when they are being sold the community and the neighborhood by the real estate professional, they remain rather objective, considering all the information they are being given.

However, once they get to the specific street and see the outside of the property, their emotions take over.  Nothing the Realtor says at this point really makes much difference.  They can see all with their own eyes, and if what they see doesn’t feel right, then they are not interested in even looking at the inside of the house.

Sometimes an experienced Realtor can get the buyers to look inside even when the buyers are not happy with the outside.  And, once in a while, the positive emotional impact of the inside is so great that it will override the buyer’s disappointment with the outside. 

But the fact remains, that if the buyer is really unhappy with steps one through four he/she will not even want to look inside the house.  This is why it is so important to work with a home stager and make sure your home really stands out as the best value both inside and outside.  

Subject to the sale of a property:

When you have a home to sell and you make the home you are purchasing contingent upon the sale of your existing home there are a few things you need to know.

If you are competing against other buyers that do not have the contingency of a home sale, most likely the seller will take another offer over yours because there is less risk to the seller.  The reason for this is that not only does that seller have to worry about your home inspection and financing on their home but they also have to worry about it for your present home sale.  For your protection it is important that you make it subject to the sale and closing of your existing property.  If you do this, you will be protected right to the end of your home sale.  The only risk to you is if your house sells and then for some reason the property you are buying something goes wrong and you can’t buy it.  Then you would have to find alternative housing.  If you have any questions, feel free to contact me at cboylejolin@kw.com or 508-208-9613.

Subject to suitable housing:

When a seller puts a home on the market and they need to find housing, they need to make it contingent upon them finding suitable housing.  What does that mean?

It means that we put that contingency in MLS (Multiple Listing Service) and any offer that you get will/should be contingent upon you finding housing.  Usually a buyer will give you 14-30 days to find housing.  If you do not find housing in that time period you can ask the buyer for an extension.  If they do not give an extension, your house would go back on the market and we would start the process over again when we have another buyer.

Please note that when you put your home on the market and subject to you finding suitable housing, you will lose some buyers.  The buyers that you will lose are the ones that need to find housing immediately and do not have the time to wait for you to find housing.

My focus is on your priority, so we will work things out one step at a time.  Ultimately, it is not in your best interest to have this contingency.  However, at times it is completely necessary.  If you can live with a friend, relative, or get some other short-term rental, it will help you net the most money in the shortest length of time.

Great questions to ask a real estate agent before you hire them

Are you a full time real estate agent?  This is very important--in this market only about 25% of the agents actually do real estate full time. 

How long have you been in the real estate business?

How is your reputation with other agents?

What specific training have you had to handle the sale of my property?

May I see a list of what you plan to do to market my property?

Who do you think will buy my property?

Do you have letters of recommendation from past clients and can I call them?

What was your background before you became an agent?

Remember, to make sure you don't pick an agent because they gave you the highest price.  Some agents will take overpriced listings so they can get buyers from your home and then sell them houses that are priced right for today's market.  You don't want to help other people sell their home do you?

The asking price is the most critical price.  It will determine how many prospective buyers will view your property and whether they will make an offer or not.  The asking price is what attracts or repels buyers and agents.  What you want for your property or what you feel you need for your property has nothing to do with the final selling price of your property.  The market alone dictate the value of your property, not your enthusiasm, your desires, your wants and not even your needs.

The buyer doesn't care about any of this--especially not today's sophisticated buyer.  Buyers nowadays go online and look at any where between 40 to 100 homes online.  They know the market value very well.  Since it is the market that usually determines the selling price, all you control is the asking price.  Again, it is the asking price that determines how much or how little activity your property will receive.  Use an asking price that will ultimately get you the highest possible selling price.  It stands to reason that the greater the activity, the more likelihood there is that offers will be presented.  The closer your asking price is to the true market value, the greater chance you have of achieving the highest possible price.

For example:  Let's say the true market value of your property is $250,000.  If you were to ask $300,000 for it, two things will happen.  1.  It won't get shown much 2.  You will not get an offer.  Also agents may show your house to show other homes that are a better value and use your home in order to sell other houses.  You don't want to help others sell, do you?

Now it you price that property at $250,000 2 things will happen.  1. You will get a lot of showings 2.  You may get mulitiple offers.  When you get multiple offers, the seller is extracted from the negotiation and the buyers then negotiate against each other.  Many times this raises the price and the seller will walk away with the highest price and the best buyer.  What result would you like?

If the buyer has the money then it is not a good idea to have the seller pay closing cost.  Buyers ask why?  Well let's think about this for a minute.  If the buyer has the money to pay their own closing costs then that is great.  Financially speaking, it makes no sense to finance closing costs (say for example $5,000) for 30 years.  You are paying interest for 30 years on something the buyer could have paid at closing.  The only time it make sense for a buyer to finance their closing costs is if they don’t have the money to close on the house.  In that case, financing in the closing costs makes a lot of sense because the buyer can’t buy otherwise. 

Now what effect does it have on the seller?  The seller needs to know that they don’t have to bring the money to the table.  It is a credit on the HUD settlement sheet.  In MA, it costs the sell 4.56 per 1,000 for the tax stamps.  So for the seller to give the buyer a credit of $5,000 it would cost the seller $22.80.  Otherwise it has no effect on the seller.  The seller should just understand what their net is that they will be walking away with after the closing.

Negotiations—why threats don’t work?

I have been in real estate my whole adult life.  I had a funny situation happen this week and it raised a lot of interesting questions.

In my opinion, I work for the best real estate company in the industry.  Part of the Keller William’s Belief System is Win-win or no deal.  This is the essence of negotiation.  A great negotiator helps their client achieve the goal they are looking for.  In my business that is obviously to sell a house or to buy one.  I have learned over the years that the seller has to be willing to do what it takes to get their home sold and a buyer needs to do what it takes to own the home that works best for their family.

I have learned that when you have those 2 components, you can work anything out.  Some people like to cloud negotiations with personal property.  I never recommend that.  The most important thing is selling or buying the home—the real estate.

So this week I ran across people that would give a threat every time we spoke or in all of their email correspondences regarding a negotiation.  Threats don’t work in a real estate negotiation.  You see most sellers can afford to stay in their home, even in this market.  They have a place to live.  On the other side, buyers have many choices in today’s market and they too usually have more than just one option when it comes to buying.  For a successful negotiation to work, each party has to feel good about the outcome.  There has to be a win-win.  Nothing good happens by threats or by not caring at all about the other party.  So keep an attitude of negotiation and a spirit of compromise and you can create a win-win negotiation.

Here is the number 1 thing you need to do to get ready to Sell Your House--Realize you have to detach emotionally from your house.  The way you live in a house and the way that you sell it are two completely different matters.  Currently in order to sell your house you need to realize that you are entering a beauty contest and a price war all in one market. 

The second thing you can do is get Free advice from a full-time real estate agent.  People always pay more when a sales person is involved.  Just think about it-- They are the expert at selling homes.  This is the reason sales people only get paid at the real estate closing after all the work has been completed.  If you follow their advice as to staging, timing, and pricing, you'll increase your chances of getting it sold quicker and at the highest possible price. 

The third thing a seller needs to do: a pre-sale home inspection is always helpful.  If repairs are needed, you will know upfront and you can get them repaired before you put the house on the market.  Buyers always think repairs cost more than they do so this will help you put more money in your pocket.  It also helps you calculate your bottom line so you know exactly what you will be walking away with. 

Also, homes with Septic systems:  it is always a good idea to get your Title V done early so if repairs are needed you will again know what you will be walking away with after the sale is complete.  Septic repairs can be as low as $1,500 or as high as $40,000.  This is a huge difference so it is important to have all the facts before you put your home on the market.

The fourth thing you need to do is do any necessary repairs and clear the clutter.  Homes that are well maintained and show well sell for 6% higher than houses that have not been stagged.  The other benefit is that they sell faster too.

The fifth step is to speak to a loan officer if you need to buy another property and call an attorney and find out how an attorney can help you through the sales process.

Here is the number 1 thing you need to do to get ready to Sell Your House--Realize you have to detach emotionally from your house.  The way you live in a house and the way that you sell it are two completely different matters.  Currently in order to sell your house you need to realize that you are entering a beauty contest and a price war all in one market. 

The second thing you can do is get Free advice from a full-time real estate agent.  People always pay more when a sales person is involved.  Just think about it-- They are the expert at selling homes.  This is the reason sales people only get paid at the real estate closing after all the work has been completed.  If you follow their advice as to staging, timing, and pricing, you'll increase your chances of getting it sold quicker and at the highest possible price.  For older homes, a pre-sale home inspection is always helpful.  If repairs are needed, you will know upfront and you can get them repaired before you put the house on the market.  Buyers always think repairs cost more than they do so this will help you put more money in your pocket.  It also helps you calculate your bottom line so you know exactly what you will be walking away with. 

Also, homes with Septic systems:  it is always a good idea to get your Title V done early so if repairs are needed you will again know what you will be walking away with after the sale is complete.  Septic repairs can be as low as $1,500 or as high as $40,000.  This is a huge difference so it is important to have all the facts before you put your home on the market.

Here is the number 1 thing you need to do to get ready to Sell Your House--Realize you have to detach emotionally from your house.  The way you live in a house and the way that you sell it are two completely different matters.  Currently in order to sell your house you need to realize that you are entering a beauty contest and a price war all in one market.